Don’t look before you leap

A huge motivator that is egging on India’s, and specifically Bangalore’s, young risk-takers is the development of what experts call an ‘entrepreneurial ecosystem’. This consists of successful entrepreneurs who form excellent role models, incubation cells such as IIMB’s NSRCEL, the presence of venture capitalists or VCs (some indigenous funds and some that have set up shop in India for the first time) and the support and resource networks created by organisations such as the National Entrepreneurship Network (NEN), which has over 70,000 members in 30 Indian cities and more than 500 member institutes.

An essential component of this ecosystem is the mentoring provided by organisations such as The Indus Entrepreneurs (TiE), the world’s largest not-for-profit organisation promoting entrepreneurship. TiE was founded in Silicon Valley in 1992 by successful entrepreneurs and professionals with roots in the Indus region and which runs a thriving network of VCs, mentors and entrepreneurs in India.

Says Sanjay Anandram, co-founder of JumpStartUp, a VC fund set up in 2000 to invest in early-stage companies: “There’s been a sea-change over the past 10 years in early stage ventures. There’s a dramatic positive change in the number of deals, the quality of deals, the profiles of entrepreneurs and the development of the ecosystem, which consists of lawyers, entrepreneurial clubs and interest groups and service-providers, as well as the presence of mentors and advisors.”

Anandram, who is also co-chair of the TiE Entrepreneur Acceleration Programme, thinks it is relatively easy to start your own venture today and the ongoing development of the ecosystem will only accelerate the growth.

“There are policy changes relating to creating local pools of capital, easier mergers and acquisitions and listing of smaller companies, which I think will take place over the next few years, that will certainly help. The biggest change has to take place in the mind—the belief that entrepreneurship is a passion worth pursuing and there’s money to be made in it,” he says.

Exciting as entrepreneurship is, it inevitably and inherently carries some risks—but increasingly, start-up owners are less afraid of failing. “Failure is not seen as a big deal anymore,” says Jaya Jha who started her self-publishing venture Pothi.com in 2008. “A failed entrepreneur is no longer a pariah—rather he is lapped up by bigger companies and start-ups,” says Jha.

Added to that is the fact that most entrepreneurs with top-drawer educational backgrounds know that it forms a safety net of sorts, says Sapna Agarwal of the IIM-B placement cell. Deferred placements, where you opt out of the placement activity in your batch to start your own venture but hold on to the option of joining it in a later year, are on the rise, says Agarwal.

“My degrees give me the confidence that employment shouldn’t be too hard to find if things don’t work out, but more importantly, they make me feel that if I, with my education, don’t understand and execute the idea I have, who will?” says Siddhartha G, who is working on creating his own e-learning product/service.

As for the recession, while opinion is divided on whether it had any effect on the entrepreneurially minded or not, some experts do feel it gave a boost to the trend. “I think the recession reminded young people that all choices carry risk. What’s riskier—taking a job that might be cut by an anonymous person sitting 10,000 miles away, or starting a venture where you have a measure of control?” asks Laura Parkin of NEN.

Srinath Setty & Srikanth Acharya
Giftwrapped

Srinath Setty and Srikanth Acharya, both in their late 20s, became entrepreneurs after short stints at large corporations: Srinath after working with GE for seven months and Srikanth after a one-and-a-half-year stint with Infosys. While at their jobs, they noticed the kind of corporate gifts being supplied by vendors and thought they were pretty lame.

They were confident that if they started their own corporate gifting company, they could do much better and an idle conversation developed into a business plan, leading to both quitting their jobs and kickstarting their venture Giftwrapped in 2005. “We knew that if we wanted to make it big, we had to sacrifice our jobs,” says Srinath, a graduate of XIME Bangalore.

Today, Giftwrapped deals with a range of products specifically suited to cater to corporate gifting, promotional and branding requirements and has an annual turnover of Rs6 crore. “The business we are in is very easy to enter as the capital requirement is small; however, scaling up is a challenge and commands investment both of people and infrastructure, which we built over the last four years in small steps,” says Srinath, who feels a lot of entrepreneurs are deterred by the myth that setting up on your own requires huge investments, while this is not true for many kinds of businesses.

Vijay Olety and Santhosh S
8KMiles

The entrepreneurial game doesn’t begin and end with starting your own company. Some young graduates prefer to join a startup instead for a novel work experience, say Vijay P Olety (left in pic) and Santhosh S who joined tech start-up 8KMiles after finishing their courses at IIIT, Bangalore. “I value my freedom and like to work on interesting products.

Having worked in an MNC earlier, I had an idea about how established companies work and the various processes that are in place. It did not suit my personality and the way I would like to work,” says Vijay, while Santhosh says start-ups offer immense learning opportunities, adding that “the freedom and responsibilities one gets in a start-up are unmatched.”

As for what excites them about working in a start-up, Vijay feels it’s not just about the product being built or the technologies leveraged but also the freedom, “no hierarchical menace, friendly atmosphere, excellent all-round career growth and no dress code”.

According to Santhosh, working in a start-up feels similar to working on academic projects with friends in a college. “It feels good to work in a small team of highly ambitious and motivated people where everyone is pulling each other up,” he says.

Sharath Coorg
QVC Realty

“I didn’t take up any job offers on campus,” admits Sharath Coorg. “With investment banks and consulting firms doling out huge pay checks, the pressure to settle down with a job was immense. But in 2006, the setting seemed perfect to dream about starting a business.”

Coorg, who opted out of placements at IIM Ahmedabad, had worked for a couple of years after finishing his B Tech course at IIT Chennai. During his IIM-A stint, he enrolled for a course called LEM (Laboratory for Entrepreneurial Motivation) conducted by Prof Sunil Handa and considers this as a great motivating factor in his considering entrepreneurship as a possible career. After some research, he chose real estate as an area of focus because he felt the largely unorganised real estate business could do with some professionalism. He was exploring the idea of starting an FDI venture fund to invest in real estate projects, but ended up joining QVC Realty started by serial entrepreneur Prakash Gurbaxani and funded by IL&FS. Coorg feels there is a “romantic” side to entrepreneurship.

“There is an image of an entrepreneur who works out of a garage, struggles and faces a lot of hardship, but eventually overcomes all odds to make it big. In college, this image of an entrepreneur is what attracts most young people,” feels Coorg, who thinks the India of tomorrow is built on entrepreneurship. Like many others, he says failure is no longer a bad word. “As in the US, failure is being seen more as a result of having tried and hence the learning from the failure is considered an asset for future ventures,” says Coorg.